Fidel Castro’s Economic Legacy

Fidel Castro died on November 25, 2016. He ruled Cuba from 1959 until 2008, transforming the country into the one-party socialist state it is today. For many, he himself represents Cuban history. Yet he was an infinitely divisive figure, and his economic legacy is controversial.

Fidel Castro, after taking power through revolution in 1959, created a socialist state at the doorstep of the United States. He adopted a Marxist-Leninist model of development and transformed Cuba into a one-party, socialist state, and Cuba has all of a sudden become an economic laboratory watched by the whole world. After Castro’s taking power, nationalisation ensued, and his policies introduced central planning and established universal healthcare and education. He has avoided the escalation of many international conflicts and continuously stood up to its powerful neighbour. He ruled through 10 US presidents and survived 638 assassination attempts. In 2008, after ruling Cuba for nearly 50 years, he stepped down and transferred power to his brother, Raúl Castro. He then led a quiet life until his death.

It is intriguing to examine the legacy of such a powerful and divisive figure, without whom Cuba’s economy and political scene would look very different today. This article concentrates on his economic legacy and Cuba’s economy today, examining the impact of Castro’s policies and socialist rule.

The main achievements Castro is credited with are universal healthcare and free education in Cuba. As a result of his policies, the levels of literacy and life expectancy compete with that in the West. The impressive healthcare reform, which started almost immediately after Castro coming into power, transformed a close to nonexistent healthcare system with only one rural hospital into an impressive, wide-reaching one accessible to all. Thanks to it, infant mortality decreased from 10% to pretty much zero. Life expectancy is 79.1 years, with which Cuba ranks 32th out of the 183 countries ranked by WHO in 2015. Cuba today spends 11% of its GDP on healthcare. Its healthcare system has been applauded by many and is consistently deemed excellent by global health institutions, which especially appreciate its quality of preventative and primary healthcare and its ability to tackle diseases. Biomedical research and pharmaceutical exports are on the rise as well.

Cuba’s outstanding education system is Castro’s legacy as well. The 2014 World Bank report on teaching and education in Latin America and the Caribbean ranked Cuba as outstanding in the continent. The literacy rate in Cuba is 99.8% in 2015, which ranks the country 15th in the world according to UNESCO data. The rate of primary education enrolment and attendance is pretty much 100%, while 85% continues on to secondary level education. Yet barely 12% continue after that. Education in Cuba is exemplary and has been the key to raising the quality of human capital in the economy. Yet to adapt to today’s progress and globalisation, more is needed than secondary education.

Although life for most in Cuba improved dramatically under Castro’s power, many believe that the country would be much more developed if it weren’t for Castro. Under the constraints of a planned, closed economy struggling from an US embargo, Cuba never fulfilled its potentials. And the reason for this is the man who established socialist rule, Fidel Castro himself.

Because of Castro, economic change in Cuba has been delayed. His economic policies ruinous, Cuba is lagging behind economies it outperformed in 1959. In 1959, its GDP per capita was $2,067 a year. Today, it is $6,051. Although this 3-fold increase seems remarkable, Albania’s economy achieved this in only 20 years, not 50. With a simple switch to market economy, Albania’s GDP rose from $1,836 in 1990 to $5,275 in 2010. Although raising living standards, socialist planning has restrained Cuba’s economy from fulfilling its potentials. In Cuba today material scarcity is still evident, with average wage being only $20 a month. For ordinary citizens, commodities such as housing, food and transport are in short supply, while goods such as books, clothes and soap are extortionately expensive.

While the Castro administration has blamed economic hardships on the US embargo, in reality central planning and socialist policies are largely responsible. Many recognise this, and advocate for a shift away from socialist planned economy. Raúl’s Economic Modernisation Plan of 2010 has already introduced features of a market economy into the socialist system. With such changes already underway, only time can tell if Fidel’s legacy survives.